While small firm lawyers understand the dangers of failing to adopt new technologies and practice models, many are too busy keeping their lights on to try new techniques to help them survive and compete.
A recently published national survey found that while lawyers understand the need for change to make their offices as efficient as possible, many hesitate to slow down long enough to make the necessary changes. The Thomson Reuters report listed acquiring new clients, time spent on administrative tasks, and the increasing complexity of technology as the biggest challenges small firm attorneys face.
While a lawyer’s job is to practice law, the survey found that the smaller the firm, the more time attorneys spend on administrative work—like bookkeeping and case management—which does not generate legal fees. The report found that, on average, 40 percent of a small firm lawyer’s day goes to such tasks.
“And most lawyers will tell you that it is highly unlikely that they will actually collect money from clients for each of those potentially billable hours,” the report said. “By the time we account for leakage due to poor timekeeping practices, discounts and write-downs offered by the lawyer to address perceived client concerns, and client pushback on the final invoice, the proportion of each working day for which a lawyer will ultimately be paid dwindles quickly.”
Brian King of King Law Offices, which employs 20 attorneys in 13 rural locations in South and North Carolina, said that he thinks the 40 percent estimate, if anything, is low. But the administrative work must be done for law firms to function properly.
“A lot of attorneys just want to go practice law,” King said, “But the best thing they can do is set aside a day each week to work on the business, which is hard to do if you’re in court … but if you don’t have that ability, it will creep into your work every day.”
Matthew Van Sickle, a solo practitioner in Raleigh who co-chairs the North Carolina Small Firm and Technology Committee, said that taking the time to streamline one’s administrative work will pay off in the long run.
“Attorneys can be pennywise and pound foolish,” he said. “You have to set aside the time to understand the technology, and when you do, it will streamline your administrative work and make it easier to do the legal work that’s at your desk.”
King recommended small firm attorneys reach out to a vendor to get help to identify areas where they can become more efficient. In addition, he said, they can also help identify which technologies are most cost-effective for the needs of a particular practice.
Legal Cloud Technology, based in Raleigh, is one such vendor that works with small- and medium-sized practices to identify and fix inefficiencies. Pegeen Turner, the company’s president, said that cloud-based technology is the great equalizer.
“With today’s technology, small firms can compete with big firms toe-to-toe,” she said. “Software used to be just for big firms … now, the same document and practice management tools are available without having to spend exorbitant amounts of money.”
While software isn’t one-size-fits-all, Turner recommended attorneys consider utilizing three specific services, if they haven’t already: a cloud-based office management system (like Microsoft Office 365 or Google Suite), an all-in-one case management software (like Clio, Practice Panther, Actionstep, or MyCase) and document assembly tools (which are often included with the purchase of case management software).
When it comes to paying to adopt new technology, attorneys should seek to get the most bang for their buck.
“Using document assembly and standard templates, it takes time up front to create them, but you get that time back over and over again in creating those documents. It’s certainly time well spent,” Turner said.
It may also be worthwhile to pay for a subscription to such services, as opposed to downloading or installing them directly onto one’s desktop or server. Also, having as much information available on cloud-based platforms allows attorneys to work from virtually anywhere securely, and a backup is always available in an emergency.
“You pay a little more that way, but it’s worth it when you consider the time you save not having to manage servers or pay an IT person,” Van Sickle said. “And you don’t have to update your software, it’s updated as it’s released.”
While the survey found that nearly half of small firms have adopted new technologies, it also showed that only 27 percent have changed marketing strategies, and less than 20 percent have changed staffing ratios, practice workflows, or billing practices. The most common technology upgrade was in case management software, followed by time and billing and document-handling.
In the end, using technology to increase efficiency matters to a firm’s bottom line only if they use the extra time to gain new clients to perform additional legal work. King said it’s important to note that if you don’t change, someone else will.
“I think technology has made it easier for the small, local attorney, but it also means that the competition can come up really quickly too,” King said. “It would take time [to implement changes], but also a mentality of, ‘If you don’t do this, larger firms will be able to practice law a lot easier across different districts, and they’ll have the technological advantage.’ It doesn’t matter how small the town is, since everybody has smartphones … If you don’t adapt, the work won’t be there, and it’s the public that loses out.”
Follow Matt Chaney on Twitter @SCLWChaney